Zcash's zk-SNARKs vs Monero's Ring Signatures: L1 Privacy Coins

Offers a dual-address system (z-addresses for shielded, t-addresses for transparent). This allows for optional privacy and regulatory compliance (e.g., tax reporting via view keys). This matters for institutions or users who need privacy but also require auditability for specific transactions.

Relied on a one-time trusted setup for its original parameters (addressed by ongoing Halo2 upgrades). Shielded transactions are more computationally intensive, leading to higher fees and slower throughput (~40 TPS) compared to transparent ones. This matters for high-frequency or low-value transactions where cost is a primary concern.

All transactions are private by default, making every XMR coin perfectly fungible. The protocol is optimized for its privacy mechanism, offering lower fees and higher practical throughput than Zcash's shielded pool. This matters for everyday transactions and users who want uniform privacy without configuration.

Privacy strength depends on the size of the anonymity set (the number of possible signers in a ring). While currently robust, theoretical blockchain analysis could weaken privacy if the set is too small. Scalability is challenged by constantly growing transaction sizes (~3x larger than Bitcoin). This matters for long-term scalability and against advanced, resourceful adversaries.

Zero-knowledge proof privacy: Uses zk-SNARKs to cryptographically shield transaction amounts and participants. This enables selective disclosure for institutional compliance (e.g., tax reporting, regulatory audits via viewing keys). The protocol supports both transparent (t-addr) and shielded (z-addr) transactions, offering flexibility.

High computational overhead: Generating a zk-SNARK proof requires significant resources (~40 seconds, 4GB RAM on standard hardware). This impacts user experience for light clients. While transaction sizes are small (~2 KB for shielded), the proving time is a bottleneck compared to non-private L1s like Ethereum or Solana.

Mandatory privacy by default: Every Monero transaction uses Ring Signatures, Stealth Addresses, and RingCT to obscure sender, receiver, and amount. This creates a uniform transaction graph where all outputs look identical, providing strong network-level anonymity without trusted setup concerns present in early zk-SNARKs.

Larger transaction sizes: Ring signatures and RingCT make Monero transactions significantly larger (~1.5-2 KB) than Bitcoin, leading to a lower theoretical TPS and higher blockchain bloat. Verification is less computationally intense than zk-SNARK proving but places a constant higher load on all network nodes compared to transparent chains.

Institutional or compliant use cases where audit trails are required.

• Regulated DeFi integrations needing selective transparency.
• Large-value settlements where cryptographic proof of validity is paramount.
• Projects building on EVM-compatible privacy layers (e.g., Aztec, zk.money) that use similar tech.

Maximum on-chain privacy and fungibility as a core protocol feature.

• Censorship-resistant payments where observer detection must be minimized.
• Lightweight client privacy where users cannot run heavy proving setups.
• Applications prioritizing network-level anonymity sets over individual proof strength.

zk-SNARKs provide cryptographic proof: Transactions can be fully shielded (z-addresses) or transparent (t-addresses). This enables regulatory compliance for exchanges and institutional use, as seen with Gemini and Coinbase listings. The trade-off is privacy is opt-in, creating a potential metadata footprint.

Once a note is in the shielded pool, transactions are highly efficient. Proof verification is constant-time, and the privacy set is the entire pool (estimated at 1M+ notes). This is optimal for high-value, inter-institutional settlements where auditability via view keys is required.

Every transaction uses Ring Signatures + Stealth Addresses + RingCT. There is no transparent ledger. This eliminates metadata leakage from opt-in models and provides strong network-level anonymity for all users, a key differentiator for censorship-resistant payments.

Relies on well-understood cryptographic primitives (ring signatures, DLSAG) without a trusted setup. Contrasts with Zcash's original 2016 Powers of Tau ceremony. This appeals to projects prioritizing maximal decentralization and avoidance of trusted third parties.

Relies on a one-time trusted setup (MPC ceremony). While the 2016 parameters are considered secure, it introduces a theoretical attack vector absent in Monero. Complexity risk: zk-SNARK circuits are intricate, and bugs (like the 2019 counterfeiting bug) can be catastrophic.

Ring signatures scale linearly with decoy size (currently 16), increasing transaction size (~3KB) vs Zcash (~2KB). Passive chain analysis is possible over time as decoy outputs are spent, potentially reducing the effective anonymity set, a concern for long-term asset holdings.